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Partially Identified Poverty Status: A New Approach to Measuring Poverty and the Progress of the Poor

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  • Gordon Anderson
  • Maria Grazia Pittau
  • Roberto Zelli

Abstract

Poverty measurement and the analysis of the progress (or otherwise) of the poor is beset with difficulties and controversies surrounding the definition of a poverty line or frontier. Here, using ideas from the partial identification literature and mixture models, a new approach to poverty measurement is proposed which avoids specifying a frontier, the price is that an agent's poverty status is only partially identified. Invoking variants of Gibrat's law to give structure to the distribution of outcomes for homogeneous subgroups of a population within the context of a finite mixture model of societal outcomes facilitates calculation of the probability of an agent's poverty status. From this it is straightforward to calculate all the usual poverty measures as well as other characteristics of the poor and non poor subgroups in a society. These ideas are exemplified in a study of 47 countries in Africa over the recent quarter century which reveals among other things a growing poverty rate and a growing disparity between poor and non poor groups not identified by conventional methods.

Suggested Citation

  • Gordon Anderson & Maria Grazia Pittau & Roberto Zelli, 2011. "Partially Identified Poverty Status: A New Approach to Measuring Poverty and the Progress of the Poor," Working Papers tecipa-421, University of Toronto, Department of Economics.
    • Handle: RePEc:tor:tecipa:tecipa-421
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    References listed on IDEAS

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    1. Jean-Yves Duclos & David E. Sahn & Stephen D. Younger, 2006. "Robust Multidimensional Poverty Comparisons," Economic Journal, Royal Economic Society, vol. 116(514), pages 943-968, October.
    2. Slesnick, Daniel T, 1993. "Gaining Ground: Poverty in the Postwar United States," Journal of Political Economy, University of Chicago Press, vol. 101(1), pages 1-38, February.
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    1. Partially Identified Poverty Status: A New Approach to Measuring Poverty and the Progress of the Poor
      by maximorossi in NEP-LTV blog on 2011-02-01 21:31:06

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    Cited by:

    1. Anderson, Gordon, 2011. "Polarization measurement and inference in many dimensions when subgroups can not be identified," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 5, pages 1-19.

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    More about this item

    Keywords

    Poverty Frontiers; Mixture Models; Gibrat's law; Partial Identification;
    All these keywords.

    JEL classification:

    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development

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